GST Registration
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Starting a business in Australia comes with various regulatory requirements, one of which is Goods and Services Tax (GST) registration. As a business owner, comprehending the essentials of GST registration is crucial for ensuring compliance with the Australian taxation system. This page aims to provide a comprehensive overview of GST registration, guiding you through the why, when, and how of this important process.
Goods and Services Tax (GST) is a broad-based tax of 10% on most goods, services, and other items sold or consumed in Australia. While it may seem like an additional administrative burden, GST registration becomes necessary for businesses that meet certain criteria, including:
If your business has an annual turnover of $75,000 or more (or $150,000 or more for non-profit organizations), you are required to register for GST.
Even if your turnover does not reach the threshold, you can choose to register for GST voluntarily. This may be beneficial if you want to claim GST credits on your business-related purchases.
If you plan to do business with other GST-registered entities, registering for GST allows you to claim input tax credits for the GST included in the price of goods and services you purchase for your business.
GST registration offers several benefits for businesses, including:
Businesses can claim a credit for the GST included in the price of goods and services used in the business.
GST registration often enhances the credibility of a business, especially when dealing with larger companies or government entities.
GST-registered businesses may be eligible for certain tax concessions or benefits.
Understanding the obligations and benefits of GST registration is vital for any business operating in Australia. By meeting the necessary requirements and maintaining accurate records, you can ensure compliance with the Australian taxation system and make the most of the benefits that come with GST registration. For more detailed information and personalized guidance, feel free to contact our office and ask to speak to one of our qualified (yet slightly boring) accountants.
This information is for general purposes only and is correct at the time of writing. As laws are constantly changing, we recommend that you speak to one of our qualified accountants before acting on any information detailed above.
GST is a 10% tax on most goods, services and items sold within Australia.
You need to register for GST if your expected GST turnover (Business income minus GST) is greater than $75,000 for the financial year. This amount is $150,000 for not-for-profit entities. You also need to apply if you provide ride-sourcing services (ie. Uber, Taxi etc) regardless of if you meet the $75,000 threshold.
This number is the same as your ABN and can be found on the governments ABN Lookup website (https://abr.business.gov.au/).
You need to register for GST if you meet the turnover threshold detailed above. If you do not, you may have to pay fines and catch up on any GST you would have had to pay.
If you register for GST, you can also claim back any GST credits business purchases that include GST.
The method you choose will depend largely on whether you take along time to collect cash from customers and pay your suppliers.
The Cash reporting method for GST is used by small businesses that pay their bills on a cash basis as the GST liabilities closely reflect the cash flow of the business, making it easier to manage.
The accruals method is mainly used by larger businesses or businesses where goods or services are not paid immediately.
Yes, you can choose to register for GST voluntarily, even if your turnover is below the threshold.
Failing to register for GST when required may result in penalties and fines imposed by the Australian Taxation Office.
Yes, some goods and services are exempt from GST, such as basic food, some education courses, and some medical services.
Generally, businesses are required to lodge their Business Activity Statement (BAS) and pay GST quarterly.
If your business is registered for GST, you can claim GST credits for business-related purchases that include GST in the price, provided you have valid tax invoices.
